Pushpay exceeds target - 108% ACMR increase in six months

Pushpay exceeds target - 108% ACMR increase in six months

Auckland, New Zealand | Redmond, Washington, USA – 13 April 2016

Pushpay Holdings Limited (NZSX:PAY) (‘Pushpay’ or ‘the Company’) announces that it has exceeded its target, increasing Annualised Committed Monthly Revenue (ACMR) by $15.11 million to $29.08 million over the six months to 31 March 2016, an increase of 108.16%. Pushpay now expects to reach its $100 million ACMR target prior to the end of February 2018, six months sooner than previously anticipated.

Chris Heaslip, Pushpay’s Chief Executive Officer said, “Our target was to increase our ACMR by over 100% to $28.00 million in the six months to 31 March 2016, and we have comfortably exceeded that target having increased our ACMR by 108.16% to $29.08 million, an increase of $15.11 million.

“Pushpay continues to gain market share in the USA faith sector, and we are now used by over 1% of the estimated 314,000 churches in the USA with an average size of over 500 attendees.i We now expect to exceed $100 million of ACMR prior to the end of February 2018, that’s six months sooner than previously forecast.”

Highlights for the quarter ended 31 March 2016

ACMR increased by $15.11 million to $29.08 million, an increase of 108.16% over the six months to 31 March 2016. Pushpay was expecting to exceed $100 million in ACMR prior to the end of August 2018, but now believes it will reach this target prior to the end of February 2018, six months sooner than previously forecast. See more under ‘Annualised Committed Monthly Revenue (ACMR)’.

Pushpay increased its customer base by 1,664 Merchants to 3,766 Merchants, an increase of 79.16% over the six months to 31 March 2016. Four of the top 10 largest churches in the USAiii have chosen to use Pushpay, the largest of which has over 34,000 attendees. See more under ‘Pushpay’s Merchant numbers’.

ARPM increased by $73 per month to $643 per month, an increase of 12.81% over the six months to 31 March 2016. See more under ‘Average Revenue Per Merchant (ARPM)’.

Months to Recover CAC remained at less than 12 months and is expected to remain at this level as the business scales.

Annual Revenue Retention Rate (excluding upsells into the existing Merchant base) continued to exceed 95%, which the Company believes places it among the best-in-class for SaaS companies. Pushpay expects its Annual Revenue Retention Rate to remain at this level as the business scales.

Staff headcount increased by 72 to 215, an increase of 50.35% over the six months to 31 March 2016. Pushpay now has 50 staff based in New Zealand and 165 staff based in the USA.

Following a competitive process, which attracted a number of interested parties, Pushpay sold the Run The Red business to Modica Group on 31 March 2016 for an aggregate value of $4.5 million. The sale of Run The Red will maximise value to Pushpay’s shareholders by freeing up capital for investment. In particular, the sale allows the Company to redeploy capital received to support its growth strategy in the USA and its target of reaching $100 million of ACMR prior to the end of February 2018. See the end notes for how the sale of Run The Red has affected our metric calculations.

During the last quarter Pushpay commenced offering event registration following increasing demand from our Merchants. See more under ‘Event registration’.

For reporting periods commencing after 1 April 2016, Pushpay will change the presentation currency for its consolidated financial statements to United States Dollars (USD) from New Zealand Dollars (NZD) and will also report key metrics in USD. See more under ‘Change in presentation currency’.

Annualised Committed Monthly Revenue (ACMR)

Pushpay previously reported its ACMR split into Merchant ACMR and Client ACMR (Run The Red). Given Pushpay sold Run The Red on 31 March 2016, the Company has not reported Client ACMR (Run The Red) in this quarterly update and will not report Client ACMR (Run The Red) going forward. Merchant ACMR is referred to as ACMR in this quarterly update and will be referred to as ACMR going forward.

The Company increased ACMR by $15.11 million to $29.08 million over the six months to 31 March 2016, an increase of 108.16%. Pushpay is pleased to have exceeded its target to increase ACMR by over 100% to $28.00 million in the six months to 31 March 2016

Pushpay now expects to reach its $100 million ACMR target prior to the end of February 2018, six months sooner than previously anticipated.

Pushpay expects to reach this target based on further development of its product, direct sales, referrals strategy and through targeting Merchants that have existing relationships with Pushpay’s strategic channel partners and other distribution partners.

We continue to refine our growth strategy, focusing on attracting larger Merchants which have the resources to maximise implementation, which in turn increases engagement and leads to higher retention. To complement this, the Company is investing in a more targeted marketing strategy, shifting away from transactional sales techniques and towards relational sales techniques and investing in sales training.

Attracting a higher number of larger Merchants will increase our ACMR growth, while also increasing our Annual Revenue Retention Rate over time.

If we see opportunities to further refine our growth strategy to attain the $100 million ACMR target sooner, we will position ourselves to take advantage of them.

Full release with charts: Pushpay_exceeds_target__108_ACMR_increase_in_six_months.pdf

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